Answer (D) is correct . A mixed cost is a combination of fixed and variable elements. Consequently, the $27 of total overhead cost is mixed because it contains both fixed overhead and variable overhead.
Answer (A) is incorrect because A carrying cost is the cost of carrying inventory; examples are insurance and rent on warehouse facilities.
Answer (B) is incorrect because A discretionary cost (a managed or program cost) results from a periodic decision about the total amount to be spent. It is also characterized by uncertainty about the relationship between input and the value of the related output. Examples are advertising and R&D costs.
Answer (C) is incorrect because A sunk cost is a past cost or a cost that the entity has irrevocably committed to incur. Because it is unavoidable, it is not relevant to future decisions.
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The total overhead cost of $27.00 for Huron’s video disc cleaning unit is a
